VeChain (VET) is a continuously growing project that has evolved from being a private blockchain logistics solution to a public multifunctional blockchain platform.
It has grown into a product in high demand which has enabled it to create a universal platform that is solely dedicated to business. The company offers a myriad of solutions that simplify the integration of blockchain among established players in the industry.
The flexibility of the platform offered by VeChain enables users to monitor the movement of a product such as branded clothing and medicine from the factory to the final consumer.
VeChain has declared that it aims to build a reliable and distributed business ecosystem platform to aid the transparent flow of information, effective collaboration, and rapid value transfers.
Supply chain data for business processes are currently distributed in silos among several stakeholders and this impacts the flow of information, which is also divided among stakeholders.
According to the white paper of VeChain, blockchain technology can solve this problem of asymmetric information by allowing possession of data to return to and empower its owner.
The VeChain platform claims to offer a 360-degree view of the required information about a specific product and its business processes (such as supply, transportation, and storage) to licensed stakeholders thereby creating greater market transparency.
How to Buy VeChain
You can buy real VeChain through exchanges such as Binance and Crypto.com.
If you want to actively trade VeChain (both long and short), with leverage, Skilling offers VeChain and 50+ other cryptocurrencies.
Step 1: Create an account with Skilling
Step 2: Verify your account and make a deposit
Verification is usually super fast and you can make deposits up to 2000 before your account is fully verified. The minimum deposit is only $100.
Step 3: Select VeChain in the platform
Step 4: Select the amount you want to trade
The margin requirement is 50%, which means that for a position in VeChain of $2000, you only need $1000 in margin.
What is VeChain?
VeChain is a blockchain platform that is designed to improve business and management processes.
This will be achieved by streamlining these processes as well as the flow of information for complex supply chains through the utilization of distributed ledger technology (DLT).
This cryptocurrency is the native coin of the VeChainThor blockchain.
The VeChain platform consists of two major tokens namely VeChain Token (VET) and VeChainThor Energy (VTHO).
VET is used for the transfer of value across the VeChain network while VTHO is used as energy for powering smart contract transactions.
A Brief History of VeChain
VeChain is a blockchain project that was established in 2015 and it was originally designed as a supply chain management and anti-counterfeiting system based on IoT and blockchain technologies.
Then it was rebranded and relaunched in December 2017 as the VeChainThor blockchain for decentralized applications (dApps).
When the project was established, VeChain became popular for its blockchain technology along with its smart product tracking chips that are compatible with multiple devices such as RFID trackers, NFC chips, or QR codes.
Writing all products into smart chips meant user data was reliable thus enabling the project to achieve its main goals which included optimization of the supply chain, ensuring the safety of products, providing protection against counterfeiting, verifying the authenticity of products, and so much more.
Despite the initial success enjoyed by VeChain in the logistics sector, the project has now firmly positioned itself to be a provider of blockchain services for businesses in any industry.
The goal of VeChain has now evolved into creating a reliable distributed ecosystem for businesses that can support a transparent flow of information and effective cooperation among the involved parties.
The project has displayed its penchant for cooperation through collaboration with big companies such as H&M, Shanghai Gas, Microsoft, Walmart China, BMW Group, and many more.
The project is managed by the VeChain Foundation which is a non-profit organization registered in Singapore in 2017.
It has a team of experts dedicated to working on legal support for the project to ensure that operations are maintained with acceptable frameworks of the law.
The foundation has a website where it publishes quarterly financial reports while simultaneously striving to build new partnerships.
Why Buy VeChain
VeChain is unique because the network offers functions that other networks cannot match and below are three reasons why buying VeChain is a good idea:
VeChain is ideal for business
The goal of VeChain has been mentioned already which is to enable a transparent flow of information and efficient collaboration by building a trust-free and distributed ecosystem platform.
While most cryptocurrencies exist to enable collaboration and high-speed value transfers, VeChain enables the flow of information in a unique way, and this is appealing to investors with the website listing some of the different ways by which VeChain can be used.
One of the ways VeChain can be used is by assigning a unique ID linked to the VeChainThor blockchain and then integrating this ID in the QR code of a specific product which can be used to track that product.
Some quality assurance companies have switched over to using solutions driven by blockchain due to ease of use and lesser costs; VeChain is one of the leading crypto networks used for this purpose.
VeChain is continuously growing and evolving
VeChain has made some significant progress as a cryptocurrency due to its tried and tested blockchain-as-a-service model which has led to the emergence of some high-profile partners that have adopted the VeChainThor blockchain to streamline their supply chain.
One of such high-profile partners is Walmart with the company announcing in 2019 that it will be partnering with VeChain for the streamlining of product management among its stores, suppliers, and customers using the VeChainThor blockchain.
With its continuous growth and evolution along with its collaboration with high-profile companies, investors that lean towards the ability of cryptocurrency networks and blockchains to offer significant value and innovation to the economy view VeChain as one of the leading cryptocurrencies in this aspect.
The merging of DLT and IoT technologies
VeChain is widely regarded as the most successful example of how combining distributed ledger technology (DLT) and internet of things (IoT) adjuvant can lead to significant innovation in the global economy.
As far as the incorporation of blockchain technologies and physical goods, VeChain is a compelling sign that the world is entering a new age.
The IoT market is particularly one with massive growth potential and it is only just starting. The potential for VeChain to be integrated with multiple IoT technologies for solutions that go beyond just the management of the supply chain where it is being utilized presently is amazing.
As companies start to adopt VeChain for streamlining their operations, it opens up a world of opportunities for them while also enhancing their level of productivity which is all due to the VeChain network.
With these compelling characteristics of VeChain, it is an attractive cryptocurrency to purchase because as more companies adopt it and people use it more, the value will increase which will enable investors to be profitable with their investment.
The Technology behind VeChain
The Ethereum blockchain serves as the basis on which the VeChainThor blockchain was developed with the Ethereum blockchain widely regarded as an excellent platform for dApps.
As a result, VeChain adopted the following technical blocks from Ethereum:
- RLP encoding methods
- Ethereum virtual machine
- Accounting/balance blockchain model
A minimum of 10 seconds is required for a block to be generated in VeChainThor and according to the team managing the project, the VeChainThor blockchain can complete 10,000 transactions per second (TPS), including the Proof of Authority (PoA) consensus mechanism.
However, when the platform was launched initially, it was with 50 TPS because that dovetailed with what the network required at that phase.
VeChainThor transactions are multitasking, which enables users to perform various actions in a single operation.
The main feature of VeChainThor is the ability to integrate blockchain technology into businesses on a massive scale.
This is why the project endeavors to develop components that will simplify the real use of business technologies without ignoring the main function of blockchain which is to transfer value.
There is an anticipation on the part of VeChain that not all traditional companies are comfortable with dealing in cryptocurrency but VeChainThor has prepared a solution for this in advance.
It has a multi-level payment model that enables a user to make transactions through the account of a sponsor.
This is suitable, especially when there are multiple parties involved in the business, and not all of them are interested in working with cryptocurrencies.
The user only needs a private and public key to use the platform and execute smart contracts using applications via a sponsored account.
Since VeChainThor was designed to be used in business applications, it is built based on the following frameworks:
- The multi-layered architecture along with interconnected and independent architectural layers
- Open protocols to link other systems and technologies
- System standardization, flexibility, and modulation
- Fast and ample development
Furthermore, there is a governance protocol that guides the process of conducting transactions on the VeChainThor blockchain.
The consensus protocol used on this blockchain is Proof of Authority and based on this protocol, votes are allocated according to VET holdings and disclosure.
VET holders that have one million tokens in their accounts but lack know-your-customer (KYC) credentials are allocated 20% of all votes while VET holders with the same amount of tokens along with KYC credentials are allocated 30% of the votes.
There are 101 master nodes required to reach a consensus on transactions in the VeChainThor blockchain and this is significant because it differs from the system used in Bitcoin where all nodes must vote on a transaction before a consensus can be reached.
There is no room for anonymous nodes as disclosure of identity is a crucial prerequisite to becoming an authority master node. Based on the white paper from VeChain, this system consumes less power and does not need a minimum number of validators to reach a consensus.
There is another type of master node in VeChain and it is known as the economic master node. These master nodes are not involved in the production of blocks or ledger records but are instead used as a check on power.
This is achieved by allocating a specific number of votes to each economic master mode depending on their VET holdings. For every 10,000 VET held by an economic master node, it corresponds to getting one vote.
The system of master nodes utilized on this blockchain centralizes voting rights in a decentralized system and the founders of VeChain have declared that their goal in creating this system is to bring about a balance between decentralization and centralization.
What Affects the Price of VeChain?
The price of VeChain has fluctuated in recent times trending upward sometimes and then downward only to stabilize at some point and then pick up again.
Amid the price fluctuations of VeChain in the market, one major factor that seems to be responsible for the price of VeChain is market sentiment and for new coins in the crypto market, they tend to be swayed in the direction of market sentiment which means the price rises when sentiment is positive and falls when it is negative.
There was a period last year that was generally poor for the crypto market and it affected VeChain as well which is further evidence of how market sentiment impacts the price of VeChain.
Another factor that affects the price of VeChain is the nature of its partners.
The collaboration of the network with high-profile companies enhances the appeal of VeChain because being associated with such companies adds to the cryptocurrency’s credibility.
VeChain continues to enhance its reputation by seeking more effective partnerships and introducing new developments to its operating protocol.
Risks in Buying VeChain
Generally, there are no investments without any risks, and investing some money in VeChain is not without some risks.
However, the major risk involved in buying VeChain is price volatility although this is not peculiar to VeChain as volatility is a major feature of all crypto assets and it is more pronounced with assets that still have a relatively short life span in the market such as VeChain.
The prices can rise and fall sharply without any prior notice and this is why investors need to conduct personal research about a particular investment opportunity and only invest the amount they can afford to lose.
Furthermore, investors should never be overcome with greed when investing but ensure to stay realistic in their expectations.
Given that many high-profile users of the VeChain blockchain have seen significant improvements in their businesses, it shows there is a massive amount of value in this cryptocurrency.
Accordingly, the value of VET which is the native token of VeChain is expected to increase according to the desirability of the network and the intensity of use.
Similar to many cryptocurrencies, VeChain is capped at 86.7 billion with all the tokens minted already. Investors with interests in VeChain are making a wager that capital inflows into VeChain through additional partnerships along with increased usage will accelerate the price of VET.
Overall, there is a strong case for VeChain being a cryptocurrency that powers a network with some massive potential and while every cryptocurrency investment has its risks, VeChain might be an incredible opportunity.